Vodaphone hints at full-fibre connections direct to homes and businesses

Vodafone is looking at investing in laying ultra-fast full-fibre broadband connections to homes and businesses in the UK if it can find partners to share the costs, according to its chief executive.

The mobile network operator said earlier this week that it would spend two billion euros on new full-fibre connections in Germany and also has invested in fixed line broadband networks in Italy, Portugal and Spain.

Vodafone’s UK CEO Nick Jeffery said he had the capital available to make an investment in Britain. “We are a committed investor, our strategy is very clear,” he said at the launch of a report commissioned by the company, Digital Super Towns, Unlocking the UK’s digital potential (pdf). “If we can find the right economics and the right partners we’ll invest here.”

Britain’s broadband infrastructure is dominated by network operator Openreach, owned by the former state monopoly BT, which provides connections to Vodafone and other service providers, as well as BT.

Cable company Virgin Media, owned by Liberty Global, has a rival network and there are a host of smaller providers, such as CityFibre.

Until recently, Openreach has focused on deploying new technology to speed up the ‘last mile’ of existing copper phone lines instead of running fibre at much greater cost all the way into homes and businesses.

However, Openreach is now sounding out its wholesale service operator customers about whether they would be willing to co-invest in full fibre connections.

“We would work with any provider who can give us the scale and access and good economic costs to connect fibre to the homes of Britain,” Jeffery said, but declined to comment on whether a deal with Openreach was in prospect.

Vodafone needed to make an adequate return, he said, which could need government incentives or partners taking a long-term strategic view to reduce the cost of individual connections.

The Scottish Government has said that it will be “driving forward the ‘Reaching 100%’ project to deliver access to superfast broadband to all residential and business premises by 2021”.

But, in common with the rest of the UK, this commitment only covers fibre to the local exchange, not the often short, but crucial, distance to the home or business.

The UK Government’s digital economy minister Matt Hancock said that the focus had to be on full-fibre and 5G mobile broadband networks after completing the roll-out of faster copper-based networks.

“The regulator Ofcom has legally separated BT and Openreach, and the test of that separation will be whether Openreach now works with other providers as well as with BT to provide the infrastructure for other retail companies to get out there,” he said at the same event attended by Vodaphone’s UK chief executive.

A spokesman for Openreach said the company was continuing to consult with its operator customers about investing in full- fibre networks.